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MGMT 410 Human Resource Management Week 5 JVA

Corporation Simulation A+ Answer
MGMT 410 Human Resource Management Week 5 JVA Corporation Simulation
MGMT 410 Human Resource Management Week 5 JVA Corporation Simulation
After reviewing the simulation, choose one of these three strategies as a possible
proposal for the CEO. Explain and justify your choice by including responses to the
Learning Questions in your proposal.
Possible Strategies
1. Employees will receive absolutely no raises, and performance management is
eliminated throughout the economic crises. Therefore, employee wages will remain the
same regardless of position held; no performance reviews are given; and there will be no
adjustments of missions, goals, and duties during this period.
2. Performance, as well as revenue, is reviewed every 6 months. This way it allows JVA
Corp. to cut or increase pay every 6 months and review its bottom line. Employees can
also benefit by having the opportunity to earn pay raises potentially twice a year, rather
than the typical annual reviews.
3. Review and make any necessary changes to the guidelines for performance
management within JVA Corp. First review the mission and goals for JVA Corp. Then
review the requirement of each employee. A review of compensation packages is also
necessary, so evaluate commission packages, expenses covered, perks, and necessity of
onsite amenities that are currently covered.
Based on the costs that have been calculated, a net savings should be evident to allow for
major or minor cost savings for JVA Corp. In the midst of calculating ways to save
expenses for JVA Corp., dont forget that your duty as an HR director is to also ensure
the well-being of employees. Its important to also represent the workers while looking
out for the interest of the company.
Your paper should address the appraisal process, performance management systems,
ways to make performance management systems more effective, various classifications
of rewards, the goal of the compensation administration, and compensation programs.
JVA Corporation Simulation
View this simulation and read the simulation overview before working on this weeks

Check this JVA Corporation Simulation to view it. You can replay this simulation by
clicking the Replay button.
JVA Corporation
JVA Corporation, established in 1995, is an international manufacturing firm based in
Plano, Texas. JVA Corp. produces wireless technology devices such as cellular phones,
walkie-talkies, intercoms, and GPS units. The JVA campus headquarters is an
impressive 17-acre facility that includes manufacturing and office space. Employees
enjoy the additional amenities of a break room lounge, fully equipped exercise room,
kitchen, and cafeteria. In addition to the amenities onsite, employees are offered various
discount tickets, discounts on various personal services such as cell phones, gym
memberships, home and auto insurance, and JVA Corp. credit cards.
JVA Corp. is a private company owned by the founders and private equity investors.
JVA boasts 185,000 worldwide employees. Of these, 3,500 are full-time salaried
managers, which includes department managers, warehouse managers, logistics
managers, human resource managers, security managers, facility managers, and shift
supervisors. The rest of the employees are either full time or part time and paid an
hourly wage with bonuses based on the number of goods produced and number of goods
Performance Management
As we begin this journey into benefits restructuring and employee performance
management, lets also consider the various aspects it entails. Performance management
is often misunderstood to only mean performance appraisals or performance reviews.
In actuality, performance management is a continuous process that consists of three
steps: defining acceptable employee performance; facilitating employee performance;
and encouraging employee performance. Performance management is accomplished
through consistent and timely feedback about employee performance focused on
achieving strategic objectives and meeting goals and mission of the organization.
Compensation Packages
It is often the case that an employee becomes eligible for compensation increases after a
certain length of service time. In doing so, more often than not, employees are reviewed
based on performance. Thus when an employees performance is rated highly, then they
may be offered additional compensations or compensation in the form of other means
rather than monetary. Ultimately, the balancing of these three areasexternal market,
internal organization, and the individuals profile is what determines what pay
structure is equitable.
Shortly after the terrorist attacks of 2001, JVA Corp.s revenue soared by 60% for the
next 5 years and stabilized for the last couple of years until the world faced sudden
recession. As many industry businesses suffered and workers lost jobs, JVA Corp. is still
in business and has been trying to achieve stability through the shakeup. Since the
recent economic hardships, JVA Corp. has suffered from a net loss of $53 billion (17%)
in the fiscal year.

You have been in the position of HR Director since 1999, so the chief executive officer
has full trust in your suggestions and final decisions. The CEO, Katelyn Van Michelson,
has entertained the possibility of closing the doors to a few of their international
factories, but it is not the preferred course of action. Before JVA Corp. proceeds to
make such drastic cuts, you have suggested making some cuts in the compensation area
of the company costs and the structure in which performance management was
previously conducted. Ms. Van Michelson was intrigued by this idea and asked that you
to submit a proposal of the cuts to take place and how those cuts will affect JVA Corp.s
future, as well as its employees.
Using your education, expertise, and passion for making changes and improving the
well-being of JVA Corp.s employees, you will prepare a proposal to be reviewed by Ms.
Van Michelson within 1 week. She will scrutinize it and thus make a final decision on
how to save and preserve the overall profitability of this company. As an HR Director,
you will review the cost of all additional compensation programs that JVA Corp. offers,
exceeding the current base salaries for employees. The current package includes
commissions, bonuses, profit sharing, and travel rewards. Based on the calculation of
150,000 employees within the United States and not counting international locations,
JVA Corp. is currently spending 8% of its revenue for additional compensations or
perks. Within the 150,000 employees, approximately 35% are eligible for all of those
additional perks, and the rest are offered a base salary with no option for additional
compensation. In order to cut costs, an alternate solution will be proposed with a goal of
spending only 5% of revenue instead of the current 8%.
Learning Questions
In making your selection, be sure to consider the following concerns:
1. How permanent or temporary is the change?
2. How much will employees lose by the change?
3. How much will JVA Corp. save by the change?
4. How will it affect the employees?
5. How will it affect JVA Corp.?
6. How will it affect the community?
7. Should international employees be subject to the same changes?
8. Does it matter whether the employees are in its U.S. base or international locations?
Dont think of these decisions with specific monetary costs but in opportunity costs
(time, morale, dedication, etc.).
Your total report must be between 500 and 750 words (use MS Words Word Count
feature on the Review tab to ensure that your answer is not too brief or too verbose).

MGMT 410 Human Resource Management Week 5 JVA

Corporation Simulation A+ Answer